Another Thai Bank Shuts Down Accounts of Local Crypto Exchange

February 27, 2018

Another major Thai bank is reportedly terminating transactions involving cryptocurrencies through the bank accounts of a local crypto exchange. This decision follows a similar move by another major Thai bank, Bangkok Bank, to terminate the same exchange’s bank accounts.

Second Bank Closes Account of Crypto Exchange

A major Thai financial institution, the state-owned Krungthai Bank, has “shut down crypto trade accounts,” the Bangkok Post reported on Monday. The bank has become the second in Thailand “to terminate transactions involving cryptocurrencies trading with Thai Digital Asset Exchange (TDAX),” a local cryptocurrency exchange.

The first bank was Bangkok Bank, which decided to terminate TDAX’s accounts with the bank last week. Earlier this month, Thailand’s central bank issued a circular, asking financial institutions to refrain from getting involved in five cryptocurrency activities.

Mr. Somchai Sujjapongse, the permanent secretary of the Finance Ministry and chairman of Krungthai Bank, ordered his bank on Monday “to halt any transactions related to cryptocurrencies with TDAX through the bank’s accounts,” the news outlet elaborated, adding that:

The move followed a Bank of Thailand request that financial institutions cooperate by refraining from making or being involved in cryptocurrency transactions, as the regulatory framework supervising digital currencies remains unclear.

Another Crypto Exchange Affected

TDAX is a privately-owned Thai cryptocurrency exchange. According to the publication, the exchange still has bank accounts with two other financial institutions: Kasikornbank (Kbank) and Siam Commercial Bank (SCB). Last week, Kbank confirmed that it was still providing service to TDAX.

According to the Bangkok Post, a source from another major domestic cryptocurrency exchange, Bx.in.th (BX), revealed that “Bangkok Bank has already terminated the exchange’s account, but did not reveal whether the termination occurred on the same day as TDAX’s termination.” Yuthavithi Rootwararit, founder and CEO of Crypto Trading Co Ltd, said, “BX’s trading volume and value are more than ten times larger than those of TDAX.”

ICOs Postponed

TDAX is also preparing to launch some initial coin offerings (ICOs). However, the regulatory uncertainty has prompted the exchange to announce that its ICO plans are now postponed.

The exchange recently completed an ICO for Jfin coin by J Ventures, a subsidiary of Jay Mart Plc which is listed on the Thai stock exchange. 100 million tokens were sold at the price of 6.60 baht per token. “Jfin coin will not be affected [by TDAX’s ICO decision], as this ICO was fully subscribed to on Feb 16, while the first trading day will be held on April 2,” Mr. Poramin Insom, TDAX’s CEO and founder, was quoted by the news outlet. He added:

Although there are five or six ICOs in the pipeline, the exchange has decided to impose a two-week postponement because market participants expect the SEC to unveil its ICO regulatory framework soon…We are waiting for the ICO regulations from the [Thai] SEC.

The Thai government is in the process of establishing a regulatory framework for cryptocurrencies, which is expected “on March 8, followed by a fintech bill,” the Bangkok Post wrote. A source told the news outlet that the “ICO regulations are focused on supervising online exchanges, which will have to register themselves with the SEC.”

Do you think all banks in Thailand will follow suit? Let us know in the comments section below.